Venture Corp net profit ‘broadly' in-line with consensus: analyst

Its net profit for FY2020 declined 18.1% YoY to $297.3m whilst its revenue declined 17.1% YoY to $3b.

Venture Corp net profit for FY2020 was down 18.1% YoY to $297.3m, but it is still "broadly" in-line with the consensus of OCBC Investment Research (OIR).

Its revenue also declined 17.1% YoY to $3b during the same period.

“The group’s results reflected the steady recovery from the various disruptions caused by the global COVID-19 pandemic,” it said in a press release.

Also read: Venture Corp FY2020 net profit fell 18.1% to $297.3m

According to OIR’s research team, new product introductions are on track for launch in Q2 2021 and through the second half of the same year.

“Venture has highlighted that expected demand for genomics-related products and solutions and advanced equipment for analysis/diagnostic use in biological systems will drive growth in its life science technologies domain. Venture is also optimistic about opportunities in adjacent domains, such as the battery electric vehicle industry,” the research team said.

The team believes that one potential form of near-term downside risks could come from product delays arising from the ongoing chip shortage.

OIR also noted that Venture possesses a strong balance sheet, with net cash of $929m despite an increase in total dividends paid in FY20.

“This should give the group ample dry powder especially as it ventures into new growth areas, and gives support to our FY2021 dividend yield forecast of approximately 4%, as at 1 March close,” the research team said.

Following adjustments to its assumptions, OIR has given Venture a “buy” rating with a fair value of $22.25.